Circuit City Seeks $4.7M for Executive Bonuses11 Feb, 2009 By: Erik Gruenwedel
Shuttered Circuit City Stores Feb. 10 asked a bankruptcy court to set aside $4.7 million from the ongoing liquidation sale for retention bonuses to select executives, according to a filing.
Under terms of the “Wind Down Incentive and Retention Plan,” CEO James Marcum and John Kelly, chief merchandising officer, together with 16 other senior executives would split $2.3 million, while 137 other “tier 2” employees would be eligible to access $1.6 million, on top of current salaries and compensation.
A final discretionary sum of $750,000 would be allocated as needed.
The Richmond, Va.-based No. 2 consumer electronics retailer, which ceased operations Jan. 16, said it would generate $250 million more than budgeted from the liquidation.
The court Feb. 3 ordered Circuit City Stores to pay Alliance Entertainment a lien payment of more $1 million for the warehousing and shipment of third-party DVD movies and related content to stores during the ongoing liquidation sale, according to a filing.
The Coral Springs, Fla.-based merchandising and fulfillment-company last month filed a claim with U.S. Bankruptcy Court in Richmond, Va., demanding the No. 2 consumer electronics retailer make good on a pre-payment lien in the amount of $1,028,153.34.
Circuit City, which filed for bankruptcy protection in January prior to ceasing operations, had disputed the lien amount and asked the court to force Alliance to deliver Circuit City-owned packaged-media product to its stores to accommodate an ongoing liquidation sale.
Circuit City agreed to set aside proceeds from the ongoing liquidation to pay the lien.
When it filed for bankruptcy, Circuit City owed Hollywood studios more than $56 million for outstanding Blu-ray and standard DVD product.